7 Habits of NYC’s Most Successful Real Estate Entrepreneurs
I’ve met countless NYC multifamily owners and entrepreneurs. All types. Those that own 12 units, and others with yuge 5,000-unit portfolios. As a by-product of working with them, I have become a student of their success. They all share similar qualities. Regardless of your stage of life or industry, these habits transcend real estate and have something to teach us all.
Additionally, for real estate investors with the market transitioning, many are looking for sound advice for dealing with pricing uncertainty. These personal habits also speak to timeless investing principles. Let’s explore:
1. They Play the Long Game
The most important quality is they play the long game.
What does that mean exactly? With a long-term mindset you look for situations that deliver significant and permanent future value.
The best owners are willing to make upfront investments that often don’t produce short-term dividends. Short-term gains (or even temporary losses) don’t matter. They see the world in a less transactional way. It’s not, “How can I cash out as soon as possible?” It’s rather, “What can I build out of this that will give me a long-term advantage?”
This explains NYC investing at its core.
2. They Put Their Ego to the Side
Considering our current president, this may sound confusing. He was successful and has a big ego but let me explain further.
An over inflated sense of self-worth can limit ones view of what is possible. Many of the most successful individuals started careers by taking positions that were nothing to brag about. I am thinking of those who started in building management, as superintendents, in one of the trades, or even opening pizza shops. One successful investor even started by giving walking tours of NYC. He is now a pioneer in RE tech.
Why? In many cases the unique experiences and perspectives these positions provided was essential and formative to their ultimate success.
3. They are Skeptical Toward Experts
The most successful owners purchased buildings in the Bronx in the 70’s, Tribeca in the 80s, the East Village in the 90s, Harlem in the 2000s, and Brooklyn in 2010.
Financial advisors and “experts” at the time of those purchases would have told them they were making mistakes. Had they taken that advice, they would have missed out on millions.
The best gather information from multiple, diverse sources. But, they always think for themselves.
As one client said: “Buying real estate is like art; you see future value where others don’t.” This way of thinking requires confidence, guts and a lot of curiosity. While most people turn away when they feel uneasy, successful investors continue exploring.[ctt link=”SefAr” template=”1″] The best gather information from multiple, diverse sources. But, they always think for themselves. [/ctt]
4. They are Ridiculously Creative
All humans will face significant challenges in their lives. It’s part of the game. For investors sometimes that is scarcity of capital, a lack of access to opportunities, or just bad luck.
The industry titans persevered, though, often using creativity to turn scarcity into opportunity. It’s the secret sauce that the best have perfected. One investor with a $200,000,000 portfolio started out by writing hand-written notes to people asking them to sell their building. Painstaking. Time consuming. People thought he was crazy. The result: several below market purchases.
Plentiful resources can stifle creativity. When you have everything you need, there’s no motivation to develop unique solutions.
5. They Have Grit
Unconventional investments almost never pay off immediately. You need to see them through. This ability is called “grit.” How is grit developed?
Studies show that immigrants become wealthier than native born US citizens of the same economic status. The environments they were born into and the challenges they faced are unimaginable to most Americans. Their paths helped them develop grit. It’s something that won’t show up on a resume, but certainly impacts performance. How bad do you want it?
6. They are Loyal and Pay it Forward
Earlier, I mentioned the best owners focus on the long game. That’s true for business, but it’s also true when building personal relationships. This is loyalty.
I recently heard someone describe dating and maintaining a long-term relationship in NYC as challenging due to the abundance of “other available options” you walk by each day. Focusing on “other available options” creates the illusion that, if you encounter problems, you don’t need to work through them. Just start over.
Successful owners do the opposite. They value relationships and know friends, colleagues, and the help of others are critical to long-term success. This includes the less powerful that work for them! Many times I have sold a building for a long term owner and learned after the fact that the super received a $50,000 or $100,000 bonus at closing. That’s rewarding loyalty.
We all “stand on the shoulders of giants,” and long-term success is impossible without a network of dependable relationships. Successful entrepreneurs share rewards with those around them, and their loyalty helps align positive energy in their lives.
7. They Work for A Bigger ‘Why’
I often hear, “What’s your ‘why’?” To reach extreme success, most entrepreneurs work for something beyond their own self-aggrandizement. It’s about something bigger than themselves.
It’s known that individuals who achieve a certain level of wealth enjoy only a marginally positive impact on their lives as they earn more. Money can buy happiness, but only to a point. That’s why money alone can’t motivate or incentivize to titan status— you need “a bigger why”.
Most immigrants don’t take their opportunities as Americans for granted. Instead, they find motivation through innovation and connecting to improve the lives of those around them. They actively use their success to improve the lives of family, friends and even society at large.
Improving Your Investing Performance
Many of the same personal qualities mentioned above can double as investing principles in uncertain markets.
Having a long-term outlook, creative business strategy, and ability to delay gratification will often lead to success. Investing alongside a bigger why (like a macro demographic trend) helps too! In the future, I may dive deeper with further examples of the attributes above with specific stories from some of the most fascinating owners I’ve met. In the meantime, feel free to reach out with any questions or comments on the topic.
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